Pharma giant under fire in the UK for hiking up cancer drug prices across Europe

Bee Kee Ng, 23 Apr 2017

A pharma giant is accused of withholding cancer drugs to force prices up across Europe.

Leaked internal emails recently showed that one of the world’s leading pharmaceutical companies, Aspen Pharmacare, “celebrated” over the price hikes of cancer drugs.

“We’ve signed new reimbursement and price agreement successfully: price increases are basically on line with European target prices (Leukeran, a bit higher!)... Let’s celebrate!” wrote an Aspen employee in a confidential email.

The company, based in South Africa - with European headquarters in Dublin - bought the marketing rights to five cancer drugs worth more than £270 million from a British firm, GlaxoSmithKline, in 2009. According to investigations, the company attempted to drive up the price of the medicines across Europe following the purchase.

Dispute over the pricing of cancer drugs

It was revealed that Aspen threatened Italian authorities that it would stop supplying Italy with the drugs in October 2013 if they did not agree to the price hikes of up to 2,100% in three months.

Eventually the Italian authorities agreed to the price hikes after being pressured by medicine shortages after a period of time, according to a cache of documents, including internal emails and presentations.

Meanwhile, the Spanish online newspaper El Confidencial Digital also reported that the pharmaceutical giant has threatened to stop selling the cancer treatments unless the Spanish health minister agreed to increase the price up to 4,000% during the negotiations.

Another leaked email also showed that the staff discussed destroying their supplies of the drug in the row.

Drug prices could be controlled due to loophole

In 2013, the cost of a generic chemotherapy drug called busulfan, used by leukaemia patients, increased from £5.20 to £65.22 a pack in England and Wales, an increase of more than 1,100%. The price of chlorambucil, also used to treat blood cancer, rose from £8.36 per pack to £40.51.

This was possible because the company exploited a loophole that allowed drug companies to impose price hikes when the existing brand name is dropped. The loophole was initially designed to make drugs cheaper once their patents expired, however, the drug companies may freely raise prices when there is no competition.

“It is worrying that several drug companies have increased the price of cancer treatment,” said a senior pharmacology research fellow at the University of Liverpool.

New laws against excessive price rises

“The price rises were at appropriate levels to promote long-term sustainable supply and the previous prices were a very low and unsustainable base,” said Dennis Dencher, chief executive of Aspen Pharma Europe.

The company also denied any deliberate acts of shortages but did not address the questions regarding the destruction of cancer drugs from the paper. UK's Department of Health has said it plans to cut generic drug costs as the estimates of the European Cancer Congress stated that price hikes for generic cancer drugs cost the NHS in England approximately £380 million a year for prescriptions dispensed outside hospitals.

“We are also bringing in new laws this year so we can take action against excessive price rises on unbranded generic medicines," said a spokesperson from the Department of Health, “No pharmaceutical company should exploit the NHS."

“We are working closely with the Competition and Markets Authority on unwarranted price rises of unbranded generic medicines, and where companies have breached competition law, we will seek damages and invest that money in the NHS." MIMS